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Cassidian


NOVEMBER 2013 ISSUE


Delayed Action
Ministry of defence misses the deadline for signing contract for M 777 155mm howitzers
 


M777-HOWITZER
M777-HOWITZER (Photo courtesy US Army)

In a poor reflection of the state of affairs in the procurement of critical equipment for India’s armed forces, the Ministry of Defence (MoD) has missed the October 15 deadline for signing the much-needed contract for 145 BAE Systems M777 155mm Ultra-Light Howitzers (ULH).

The delay in signing the contract will now mean that the price will rise to USD 885 million from USD 647 million quoted in 2010 (an increase of USD 238 million!). The Defense Acquisition Council (DAC) had cleared the purchase of howitzers in May last year and a Technical Oversight Committee was to have given its clearance. If a final decision is not made by April next year, then the deal itself could be in serious jeopardy. All work on the M777 for existing customers would have been completed by then, leaving the fate of the entire production line itself in question.

Due to the delay, BAE systems has decided to suspend production of the lightweight howitzer at its Barrow-in-Furness factory in the UK. According to the company, “The move comes about because of on-going delays in the US Government Foreign Military Sale of 145 M777 howitzers to the Government of India. After months of company investment, and with production on existing orders nearing completion, the company can no longer continue to maintain the current staffing levels.” The company stresses that there could be “some mitigation of the proposed suspension in production and potential reductions, if a formal agreement for the M777 howitzer sale to India were to be reached in the near future.”
 
 
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